The EU in-out referendum is just months away and as we near the big vote, The Charity Commission has released guidance for charity and not-for-profit organisations. On 7 March 2016, the Charity Commission released their regulatory guidance outlining what the law permits and does not permit them to do in the run up to the referendum. The guidance is aimed specifically at those who may be considering public involvement in the debate and are warned that such involvement could be classed as political activity. It goes further to say that political activity when debating the EU referendum could also be classified as a breach of law unless the organisation in question can demonstrate compliance with this guidance and two others: Commission’s guidance on Speaking out: guidance on campaigning and political activity by charities (CC9) and on Charities, Elections and Referendums.
The guidance directs charities to consider these following five elements before and during the referendum:
- Does this political activity support, and is it incidental to, the charity’s purposes?
- Are any conflicts of interest and other risks properly managed?
- Are decisions to engage properly recorded?
- What is the role of the Commission if guidance is breached?
- Does the charity’s involvement need to be registered with the Electoral Commission?
The Commission have stated that they will be watchful of any charities that breach the rules as there are ‘reputational risks’ in place for those who aim to get involved with the campaign.
Furthermore, The Charity Commission also addresses the fear felt by many charities that they could lose EU funding if they do not place a ‘remain-in’ vote. The guidance states: “For charities that are in direct receipt of such funding, the possibility of a loss of funding will clearly be an issue…However, knowing that the outcome of the referendum could result in a loss of funding would not in itself justify political activity directed at the UK remaining in the EU.”
The Commission’s Director of Legal Services, Kenneth Dibble, stated: “Political activity by a charity can only ever be undertaken in support of its charitable purposes. This guidance sets out the rules charities must follow should they be considering engaging in the EU referendum. The guidance clearly says that there are reputational risks for charities which engage in political activity on the EU referendum. Trustees must therefore consider the guidance carefully before involving their charities.” At Raffingers, we propose for all individuals to follow the guidance. Parties wishing to participate in political activity must act as an individual and not on the behalf of the charity. It is important that all individuals are aware of the impact that taking part in political activity has on their charity.
The full version and more information on the regulatory guidance can be found here.